Detailed guide on travel expense reimbursement

The first and essential travel expense, transportation cost, has to be reimbursed. All kinds of transport used on the business trip are supposed to be in the reimbursement claim. These include train or flight tickets, public transport in the city, car rental costs, or ride shares.

Employees must have valid transport expense proof like ticket copy, payment receipts, etc., as proof of transaction.



Business travel expense reimbursement also includes accommodation expenses. Hotel or any other accommodation place charges, valet or parking expenses, internet or sim fees, etc. You can always set expense limits so that your employees know what can be booked inside the budget. This help in sidestepping the problem of overspending. 



Another category considered under corporate travel expense reimbursement is business-related entertainment expenses. These are costs employees have to incur to keep the clients or potential clients entertained and engaged. This can be social events, concerts, dinner parties, etc.

Also, if the employee spends on food, drinks, and other refreshments for the clients, those are also reimbursed. 



If the employees buy meals for themselves or any refreshments, those are also supposed to be reimbursed by the company. These meals can be for themselves or for the clients. Daily meals can be counted under the per-diem expense of the employee as well. The daily allowance given to a travelling employee is called the per-diem expense. 



Incidental expenses are those minimal costs incurred apart from the major costs of traveling. Room service charges, tips to hotel staff or chauffeur, customer gifts, laundry service charges, etc. These expenses can be reimbursed after the trip. 

There’s no reason to confuse your employees, especially when it comes to a policy that they’ll have to reference a lot.

Having a simple travel expense reimbursement policy that is easily understandable by all employees will streamline all processes involved.



Your policy for travel expenses reimbursement is no good if your employees have no clue how to follow it. You want your travel expense reimbursement policy to have plenty of details about the different steps involved while keeping it user-friendly.



Considering that there are a lot of details on travel reimbursement that you want to include, it’s important to maintain your policy and keep it neatly structured. This way, it’s easier to make changes and adjustments if necessary.

As mentioned, there are different types of expenses that will be incurred during business trips. This includes transportation expenses, lodging expenses, client entertainment expenses, and many more.

You’ll want to break down which expenses fall into what category in your travel expense reimbursement policy to provide clarity to your employees.



Make a list of what expenses are applicable for travel reimbursement. While the details may differ from company to company, reimbursable expenses typically include transportation, accommodation, meals, client gifts, visa charges, and other business-related expenses.

Make sure that your employees know who the right person to ask is for expenses that they’re unsure about.



Any personal expenses incurred by your employees during the duration of their trip are not reimbursable. This means that should an employee choose to do any personal shopping, those expenses will not be allowed for travel reimbursement.

Any travel upgrades your employees choose to get that are outside of the initial travel budget will also not be reimbursed.



You want to be sure that you comply with tax regulations regarding your travel expenses and reimbursements. Note that employee allowances and reimbursements are two separate things.

For tax purposes, ensure you are aware of the differences and what your obligations are for paying travel expenses reimbursement specifically.



To make sure that you don’t get an inflated number when your employees submit their reimbursement claims at the end of each business trip, you want to create a daily budget for each expense category.

This daily allowance is called per diem. Specify what the per diem rates are to encourage employees to stay within budget.



Every company will have its own reimbursement claim requirements. While some might only require an upload of the receipt, others might want more details and supporting documents.

Make sure that when you create your travel expense reimbursement policy, you’re clear on what your reimburses need to get the travel expenses reimbursement claims processed.



To make sure that everyone involved in the travel reimbursement process is on the same page, you want to include a section about how you plan to do reimbursements.

This makes sure that everyone’s expectations are aligned with one another. You also want to outline what are the responsibilities of everyone involved and what is involved.



At the end of the day, a travel expense reimbursement policy is written to have everyone in your company adhere to it to ensure compliance and develop standardized processes.

It’s important that you outline a section about policy compliance and what the consequences are for deviating from the policy or fraud attempts.

Before travel expense reimbursement comes pre-travel approval, employees are supposed to submit a request and all related documents for the trip. This request mentions all the details of the travel, like place, time, dates, purpose, expense budget requirement, etc.

It is essential that your company has a requirest template or set system through which the employees put in their travel requests and get approvals. 



Once the employee travel request is submitted, the company is supposed to process the further details. You have to give the employees expense guidelines, a list of all reimbursable expenses, clarity on reimbursement policies, and an approved expense budget. This is done to ensure that the employees have a clear understanding of everything that is allowed and the expense policy limits. 



While the employees are on a business trip, it is essential that they document every expense. Receipts of meals and drinks, client entertainment activity receipts, travel tickets, hotel reservation and stay documents, etc. All these have to be collected and stored. These receipts and documents are then attached while claiming reimbursement. 



When the employees come back from the business trip, they are supposed to prepare a report of all the expenses incurred during the trip. This report has to include details of all the expenses, like category, amount, merchant, etc.

Along with this report, the receipt of the purchases is attached. The finance department collects these reports and calculates the total reimbursements. 



The finance department scans every detail and matches the claim amount to the original receipt attached. This is done for extra ensure that all expenses are legit and everything is in compliance with the company expense policy.

Plus, sometimes, employees slip extra expenses into the expense report. The finance team has to make sure that every expense has a document proof of it. Once checked, the reimbursement is approved.



Once all the details are sorted and the reimbursement claim is approved, the next step is to process the amount. The reimbursement amount is usually given to the employees along with their salaries. 



After everything is done, travel expense reimbursement is added to the accounting sheet. All the details are rechecked, and reconciliation is initiated. Every expense is recorded, and then all necessary data is put into reports to maintain a database.

Suggested read: What is account reconciliation, types, benefits and procedure

● Accurate financial records

Manual business travel expense reimbursement process is highly prone to errors. There are various mistakes the employees, the managers, and the finance team can make while submitting, checking, and reconciling travel expenses. However, an automated system takes over the whole process. Your employees just have to upload the snapshot of their expense receipts, and the rest will be done by the system automatically. The managers also just have to approve or reject the reimbursement request summary shown on their screens. 

● Enhanced expense reporting and analytics

How much time does your whole team take to compile all expense data, categorize and sort it to make a meaningful report? Probably days! Just imagine all required data being available with just a few clicks. This is what expense reporting automation does for you. It tracks, records, and collects all expense data in real-time and instantly organizes it into meaningful reports that can be accessed anytime. Using this, you can implement changes and make other decisions rather quickly. 

Master the art of expense tracking. Delve into our insightful article to learn effective strategies for tracking expenses, and gaining financial visibility.

● Help eliminate paperwork

It takes tons of paperwork and approvals to get just one business trip approved, managed, and reconciled. Employees and managers both have to go through huge lumps of documents to record everything and to ensure that the travel reimbursement process is completed with accuracy. But why not eliminate all this hassle and automate the travel expenses management process? It automatically processes the data and reports, and the managers just have to click approve or reject on their screen, making the process easier and quicker. 

● Ensure greater policy compliance

Policy compliance is the most difficult to maintain in an expense reimbursement process. However, automation solves this problem also. Any expense claim that is not in compliance with the company policies and rules will automatically be rejected. The claim will not go further for reimbursement processing if the expense amount or category or any other requirements do not match the company policy. Hence you no longer have to worry about expense fraud! 

● Time efficiency and cost savings

The ultimate motive for getting travel expenses management automation is to help your company save time and money. All those hours spent on making expense reports, filing reimbursement claims, checking all the paperwork, getting approvals, and reconciling with the accounting books can be reduced to just a few minutes with automation. Plus, all the extra costs spent on error correction and overtime for completing the process can be eliminated with automation. 

● Increased trust and satisfaction

When your employees are reimbursed quickly, and the process is easy and convenient; they will build a sense of trust and satisfaction towards the institution. This convenience and ease can only come through the automation of the travel expenses reimbursement process. Employees just have to upload snapshots of their receipts, and the system will take care of the rest. 

● Faster reimbursement (Lowers the personal burden)

Again, the automation system will complete the reimbursement process faster than the manual processing time, so your employees will not have to worry about being short on personal finances or will not have to bear any burden of their personal funds. Faster reimbursements keep your employees happy. 

● Easy expense claims

With an expense management automation system, your employees can easily raise reimbursement claims, track the process, check the status of their claims, and finally be updated on when their reimbursement is approved and transferred. Along with this, the system will allow them to follow a clear-cut process without much hassle and documentation requirements. 

● Stress-free travel experience

Once you have proper reimbursement and travel expense management structure in place, your employees will not have to worry about reimbursements. Stress-free travel experience for your employees. A proper system assures that if the employees provide evidence for all expenses and file their claims correctly, they will be compensated no matter what. 

As an all-in-one expense management software, you can manage all business expenses with Volopay, including employee reimbursements. You can create expense categories for business travel for your own convenience.

Employees will then be able to file reimbursement claims from anywhere through the use of a mobile app in just a few clicks.

Plus, our dedicated expense reimbursement software ensures that every claim is tracked and managed seamlessly, making expense management a breeze for your entire organization.

With Zoho Expense, you can make and manage online travel bookings. You can also manage offline travel-related needs, enabling you to make itineraries and travel profiles for smoother business travel.

This way, tracking any expenses made during business trips will be simple. Easily pinpoint which travel expenses were made out of pocket and need to be reimbursed.



SAP Concur offers a way to accurately track and report your business travel expenses hassle-free. Employees on business trips can snap pictures of expense receipts on the go, allowing you to keep all your travel expenses reimbursement data in one place.

The reimbursement process can happen much faster when everything is easily accessible.



TravelPerk is a travel management platform that helps you manage business trips and costs. You can collect all travel invoices through TravelPerk and employees won’t have to manually do expense reports.

The platform allows you to view one invoice with all the details at the end of each trip, eliminating the need for paper travel reimbursement documents.

Fyle makes expense reporting stress-free for employees. Expense reports can be done at any time from anywhere with Fyle and will be reflected directly on the platform.

Every reimbursable expense is recorded on a centralized dashboard and can be filtered and viewed to make the travel reimbursement process go smoother.